| BORROWINGS |
7. BORROWINGS
Short-term Borrowings
The Company classifies borrowings with original maturities of one year or less as short-term. Short-term borrowings consist primarily of securities sold under agreements to repurchase, which are secured customer transactions that generally mature on the following business day, and advances from the FHLB. The Company can also utilize federal funds purchased (secured overnight borrowings from other financial institutions), and other lines of credit, as needed.
Total short-term borrowings consisted of the following as of the periods ended (dollars in thousands):
|
|
|
|
|
|
|
|
|
|
March 31, |
|
December 31, |
|
|
|
2026 |
|
2025 |
|
Securities sold under agreements to repurchase |
|
$ |
144,605 |
|
$ |
75,432 |
|
FHLB advances |
|
|
385,000 |
|
|
650,000 |
|
Total short-term borrowings |
|
$ |
529,605 |
|
$ |
725,432 |
|
|
|
|
|
|
|
|
|
Average outstanding balance during the period |
|
$ |
589,390 |
|
$ |
175,929 |
|
Average interest rate during the period |
|
|
3.60 |
% |
|
3.44 |
% |
Average interest rate at end of period |
|
|
3.53 |
% |
|
3.15 |
% |
Short-term borrowings are used to manage normal liquidity and support the Company’s asset and liability management strategies and can fluctuate depending on funding needs. The Company’s available unused short-term borrowings consisted of the following as of the periods ended (dollars in thousands):
|
|
|
|
|
|
|
|
|
|
March 31, |
|
December 31, |
|
|
|
2026 |
|
2025 |
|
Federal funds lines with correspondent banks |
|
$ |
1,410,000 |
|
$ |
1,410,000 |
|
Alternative line of credit with correspondent bank |
|
|
25,000 |
|
|
25,000 |
|
FHLB secured line of credit (1) |
|
|
5,628,019 |
|
|
5,277,231 |
|
Federal Reserve Discount Window (2) |
|
|
2,418,498 |
|
|
2,573,492 |
|
Other secondary sources (3) |
|
|
5,084,446 |
|
|
4,960,331 |
|
Total available unused short-term borrowings |
|
$ |
14,565,963 |
|
$ |
14,246,054 |
|
(1) The Company’s total credit capacity with FHLB was $11.2 billion and $11.1 billion at March 31, 2026 and December 21, 2025, respectively. Based on the amount of collateral pledged, the secured line of credit capacity was $6.0 billion and $5.9 billion at March 31, 2026 and December 31, 2025, respectively.
(2) The Company’s Federal Reserve Discount Window borrowing capacity was $2.4 billion and $2.6 billion, none of which were used at March 31, 2026 and December 31, 2025, respectively.
(3) Includes unpledged AFS securities, brokered deposits, and unrestricted cash and cash equivalents.
Refer to Note 8 “Commitments and Contingencies” within this Item 1 of this Quarterly Report for additional information on the Company’s pledged collateral. The Company has certain restrictive covenants related to certain asset quality, capital, and profitability metrics associated with these lines and was in compliance with these covenants as of March 31, 2026 and December 31, 2025.
Long-term Borrowings
Total long-term borrowings consisted of the following as of March 31, 2026 (dollars in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Spread to |
|
|
|
|
|
|
|
|
|
Principal |
|
|
3-Month SOFR |
|
Rate (3) |
|
Maturity |
|
Investment (4) |
Trust Preferred Capital Securities (5) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Trust Preferred Capital Note – Statutory Trust I |
|
$ |
22,500 |
|
|
2.75 |
% (1) |
|
6.69 |
% |
6/17/2034 |
|
$ |
696 |
Trust Preferred Capital Note – Statutory Trust II |
|
|
36,000 |
|
|
1.40 |
% (1) |
|
5.34 |
% |
6/15/2036 |
|
|
1,114 |
VFG Limited Liability Trust I Indenture |
|
|
20,000 |
|
|
2.73 |
% (1) |
|
6.67 |
% |
3/18/2034 |
|
|
619 |
FNB Statutory Trust II Indenture |
|
|
12,000 |
|
|
3.10 |
% (1) |
|
7.04 |
% |
6/26/2033 |
|
|
372 |
Gateway Capital Statutory Trust I |
|
|
8,000 |
|
|
3.10 |
% (1) |
|
7.04 |
% |
9/17/2033 |
|
|
248 |
Gateway Capital Statutory Trust II |
|
|
7,000 |
|
|
2.65 |
% (1) |
|
6.59 |
% |
6/17/2034 |
|
|
217 |
Gateway Capital Statutory Trust III |
|
|
15,000 |
|
|
1.50 |
% (1) |
|
5.44 |
% |
5/30/2036 |
|
|
464 |
Gateway Capital Statutory Trust IV |
|
|
25,000 |
|
|
1.55 |
% (1) |
|
5.49 |
% |
7/30/2037 |
|
|
774 |
MFC Capital Trust II |
|
|
5,000 |
|
|
2.85 |
% (1) |
|
6.79 |
% |
1/23/2034 |
|
|
155 |
AMNB Statutory Trust I |
|
|
20,000 |
|
|
1.35 |
% (1) |
|
5.29 |
% |
6/30/2036 |
|
|
619 |
MidCarolina Trust I |
|
|
5,000 |
|
|
3.45 |
% (2) |
|
7.13 |
% |
11/7/2032 |
|
|
155 |
MidCarolina Trust II |
|
|
3,500 |
|
|
2.95 |
% (2) |
|
6.63 |
% |
1/7/2034 |
|
|
109 |
Total Trust Preferred Capital Securities |
|
$ |
179,000 |
|
|
|
|
|
|
|
|
|
$ |
5,542 |
Subordinated Debt (5) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2031 Subordinated Debt (6) |
|
$ |
250,000 |
|
|
— |
% |
|
2.88 |
% |
12/15/2031 |
|
|
|
2032 Subordinated Debt (7) |
|
|
190,000 |
|
|
— |
% |
|
3.88 |
% |
3/30/2032 |
|
|
|
2029 Subordinated Debt (8) |
|
|
168,000 |
|
|
2.62 |
% (1) |
|
6.56 |
% |
11/15/2029 |
|
|
|
Total Subordinated Debt |
|
$ |
608,000 |
|
|
|
|
|
|
|
|
|
|
|
Fair Value Discount (9) |
|
|
(17,560) |
|
|
|
|
|
|
|
|
|
|
|
Investment in Trust Preferred Capital Securities |
|
|
5,542 |
|
|
|
|
|
|
|
|
|
|
|
Total Long-term Borrowings |
|
$ |
774,982 |
|
|
|
|
|
|
|
|
|
|
|
(1) Three-Month Chicago Mercantile Exchange Secured Overnight Financing Rate (“SOFR”) + 0.262%.
(2) Three-Month Chicago Mercantile Exchange SOFR.
(3) Rate as of March 31, 2026. Calculated using non-rounded numbers.
(4) Represents the junior subordinated debentures owned by the Company in trust and is reported in “Other assets” on the Company’s Consolidated Balance Sheets.
(5) Trust Preferred Capital Securities and Subordinated notes qualify as Tier 2 capital for the Company for regulatory purposes.
(6) Fixed-to-floating rate notes. On December 15, 2026, the interest rate changes to a floating rate of the then current Three-Month Term SOFR plus a spread of 186 bps through its maturity date or earlier redemption. The notes may be redeemed before maturity on any interest payment date occurring on or after December 15, 2026.
(7) Fixed-to-floating rate notes acquired in the Sandy Spring acquisition. On March 30, 2027, the interest rate changes to a floating rate equal to the then current Three-Month Term SOFR plus a spread of 196.5 bps through its maturity date or earlier redemption. The notes may be redeemed before maturity on any interest payment date occurring on or after March 30, 2027.
(8) Fixed-to-floating rate notes acquired in the Sandy Spring acquisition. On November 15, 2024, the interest rate changed to a floating rate equal to the then current Three-Month Term SOFR plus a spread of 262 bps and a 26 bps spread adjustment through its maturity date or earlier redemption. The notes may be redeemed before maturity on any interest payment date occurring on or after November 15, 2024.
(9) Remaining discounts of $12.6 million and $5.0 million on Trust Preferred Capital Securities and Subordinated Debt, respectively.
Total long-term borrowings consisted of the following as of December 31, 2025 (dollars in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Spread to |
|
|
|
|
|
|
|
|
|
Principal |
|
|
3-Month SOFR |
|
Rate (3) |
|
Maturity |
|
Investment (4) |
Trust Preferred Capital Securities (5) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Trust Preferred Capital Note – Statutory Trust I |
|
$ |
22,500 |
|
|
2.75 |
% (1) |
|
6.66 |
% |
6/17/2034 |
|
$ |
696 |
Trust Preferred Capital Note – Statutory Trust II |
|
|
36,000 |
|
|
1.40 |
% (1) |
|
5.31 |
% |
6/15/2036 |
|
|
1,114 |
VFG Limited Liability Trust I Indenture |
|
|
20,000 |
|
|
2.73 |
% (1) |
|
6.64 |
% |
3/18/2034 |
|
|
619 |
FNB Statutory Trust II Indenture |
|
|
12,000 |
|
|
3.10 |
% (1) |
|
7.01 |
% |
6/26/2033 |
|
|
372 |
Gateway Capital Statutory Trust I |
|
|
8,000 |
|
|
3.10 |
% (1) |
|
7.01 |
% |
9/17/2033 |
|
|
248 |
Gateway Capital Statutory Trust II |
|
|
7,000 |
|
|
2.65 |
% (1) |
|
6.56 |
% |
6/17/2034 |
|
|
217 |
Gateway Capital Statutory Trust III |
|
|
15,000 |
|
|
1.50 |
% (1) |
|
5.41 |
% |
5/30/2036 |
|
|
464 |
Gateway Capital Statutory Trust IV |
|
|
25,000 |
|
|
1.55 |
% (1) |
|
5.46 |
% |
7/30/2037 |
|
|
774 |
MFC Capital Trust II |
|
|
5,000 |
|
|
2.85 |
% (1) |
|
6.76 |
% |
1/23/2034 |
|
|
155 |
AMNB Statutory Trust I |
|
|
20,000 |
|
|
1.35 |
% (1) |
|
5.26 |
% |
6/30/2036 |
|
|
619 |
MidCarolina Trust I |
|
|
5,000 |
|
|
3.45 |
% (2) |
|
7.10 |
% |
11/7/2032 |
|
|
155 |
MidCarolina Trust II |
|
|
3,500 |
|
|
2.95 |
% (2) |
|
6.60 |
% |
1/7/2034 |
|
|
109 |
Total Trust Preferred Capital Securities |
|
$ |
179,000 |
|
|
|
|
|
|
|
|
|
$ |
5,542 |
Subordinated Debt (5) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2031 Subordinated Debt (6) |
|
|
250,000 |
|
|
— |
% |
|
2.88 |
% |
12/15/2031 |
|
|
|
2032 Subordinated Debt (7) |
|
|
190,000 |
|
|
— |
% |
|
3.88 |
% |
3/30/2032 |
|
|
|
2029 Subordinated Debt (8) |
|
|
168,000 |
|
|
2.62 |
% (1) |
|
6.53 |
% |
11/15/2029 |
|
|
|
Total Subordinated Debt |
|
$ |
608,000 |
|
|
|
|
|
|
|
|
|
|
|
Fair Value Discount (9) |
|
|
(20,682) |
|
|
|
|
|
|
|
|
|
|
|
Investment in Trust Preferred Capital Securities |
|
|
5,542 |
|
|
|
|
|
|
|
|
|
|
|
Total Long-term Borrowings |
|
$ |
771,860 |
|
|
|
|
|
|
|
|
|
|
|
(1) Three-Month Chicago Mercantile Exchange SOFR + 0.262%.
(2) Three-Month Chicago Mercantile Exchange SOFR.
(3) Rate as of December 31, 2025. Calculated using non-rounded numbers.
(4) Represents the junior subordinated debentures owned by the Company in trust and is reported in “Other assets” on the Company’s Consolidated Balance Sheets.
(5) Trust Preferred Capital Securities and Subordinated notes qualify as Tier 2 capital for the Company for regulatory purposes.
(6) Fixed-to-floating rate notes. On December 15, 2026, the interest changes to a floating rate of the then current Three-Month Term SOFR plus a spread of 186 bps through its maturity date or earlier redemption. The notes may be redeemed before maturity on any interest payment date occurring on or after December 15, 2026.
(7) Fixed-to-floating rate notes acquired in the Sandy Spring acquisition. On March 30, 2027, the interest rate changes to a floating rate equal to the then current Three-Month Term SOFR plus a spread of 196.5 bps through its maturity date or earlier redemption. The notes may be redeemed before maturity on any interest payment date occurring on or after March 30, 2027.
(8) Fixed-to-floating rate notes acquired in the Sandy Spring acquisition. On November 15, 2024, the interest rate changed to a floating rate equal to the then current Three-Month Term SOFR plus a spread of 262 bps and a 26 bps spread adjustment through its maturity date or earlier redemption. The notes may be redeemed before maturity on any interest payment date occurring on or after November 15, 2024.
(9) Remaining discounts of $12.9 million and $7.8 million on Trust Preferred Capital Securities and Subordinated Debt, respectively.
As of March 31, 2026, the scheduled maturities of long-term debt are as follows for the years ending (dollars in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Trust |
|
|
|
|
|
|
|
|
Preferred |
|
|
|
|
|
Total |
|
|
Capital |
|
Subordinated |
|
Fair Value |
|
Long-term |
|
|
Notes |
|
Debt |
|
Discount (1) |
|
Borrowings |
For the remaining nine months of 2026 |
|
$ |
— |
|
$ |
— |
|
$ |
(2,043) |
|
|
(2,043) |
2027 |
|
|
— |
|
|
— |
|
|
(2,485) |
|
|
(2,485) |
2028 |
|
|
— |
|
|
— |
|
|
(2,309) |
|
|
(2,309) |
2029 |
|
|
— |
|
|
168,000 |
|
|
(2,198) |
|
|
165,802 |
2030 |
|
|
— |
|
|
— |
|
|
(1,641) |
|
|
(1,641) |
Thereafter |
|
|
184,542 |
|
|
440,000 |
|
|
(6,884) |
|
|
617,658 |
Total long-term borrowings |
|
$ |
184,542 |
|
$ |
608,000 |
|
$ |
(17,560) |
|
$ |
774,982 |
(1) Includes discount on Trust Preferred Capital Securities and Subordinated Debt.
|